How to respond to a CP2000 notice for a client

Published 16 October 2026. Updated 16 October 2026.

A CP2000 is a proposal, not a bill. The IRS has compared the income and payment information it received from third parties (employers, banks, brokerages, clients who issued 1099s) with the client's filed return, found a difference, and proposed changes to the return. The change can raise the tax, lower it or leave it unchanged. Your job is to find out, item by item, whether the proposal is right. This guide covers that method for a return already filed, whether you prepared it or inherited it.

Before you read the numbers

Collect four things first:

1. The notice, every page. The items are often on a later page than the summary.
2. The return as filed, with every schedule and statement. Not the draft in your software, the filed copy.
3. Any records for the disputed items: the payer's form, brokerage statements, a bank record, a contract.
4. The date the notice says a response is due, as printed. If you need more time, the IRS page Understanding your CP2000 series notice explains how to ask for it. Ask before the date, not after.

Note the notice number, the tax year and the agency's name exactly as printed. They go at the top of the response.

Step 1: List every proposed item

Go through the notice and write one row per item the IRS says was not reported or was under-reported. For each, record:

• the payer name and the form type (for example 1099-B, 1099-NEC, 1099-INT)
• the amount the notice states, to the cent
• the page of the notice it appears on

Do not total anything yet. The notice's own totals are the last thing to check, not the first.

Step 2: Find each item on the filed return

For every row, find where the return reports that income. Write the form, line and page of the return, and the amount reported there. There are four outcomes:

Be strict about amounts. A difference of one cent is still a difference, and rounded figures hide errors.

Some income is reported on a line together with other items, such as several 1099-INT forms rolled into one interest line. In that case, add the contributing forms and show the sum in your schedule so the reader can follow it.

Step 3: Decide a position per item

For each row, choose one of three positions.

1. Agree. The income was not reported and the proposed amount is right. Say so plainly.
2. Do not agree. The income was reported, or is not income of this taxpayer, or the amount is wrong. Say which, and point to the evidence.
3. Need more information. You cannot tell yet. Ask the client, and do not guess in writing.

Positions are professional judgments and belong to whoever signs. A schedule tells you what the pages say. It does not tell you what the client's facts are. Items that appear on no line of the return deserve a conversation with the client before you agree: sometimes the payer issued a form in error, and sometimes the client forgot an account.

Step 4: Build the schedule

The schedule is the strongest part of a good response, because it lets the reader check your claim without taking your word for it. One row per item, with these columns:

• item (payer and form)
• amount per the notice
• amount per the return, with form, line and page
• difference
• your position

Number the pages of the attachments and cite them in the rows, so that "Form 1040, line 2b, page 2" can be found in thirty seconds. Label the schedule as an exhibit (Exhibit A is a common choice) and refer to it in the letter.

Step 5: Check the arithmetic last

Add the schedule columns and compare the totals with the notice. If the notice lists the tax change, penalty and interest separately, recompute their sum and compare it with the amount the notice says is due. A mismatch between a notice's components and its stated total is worth raising in the response. A mismatch in your own schedule is worth fixing before anyone else sees it.

Step 6: Write the letter

Keep it short and factual. A workable order:

1. Reference block: notice number, notice date, tax year, taxpayer name, your firm's details.
2. One sentence on what you are responding to.
3. Item by item: the position, then one or two sentences of reason and a pointer to Exhibit A or another attachment.
4. A list of enclosures.
5. Signature block, with the date, for the person signing.

If the notice came with a response form, the IRS asks for it to be completed, signed and sent with the reply. Send by one of the methods the notice describes (the IRS lists upload, fax and mail for a CP2000), and keep proof of when and how it was sent. For a longer treatment of what goes in the letter, see the guide to a response letter checklist.

Common mistakes

• Answering the summary and skipping the later pages of the notice.
• Using the draft return in your software instead of the filed copy.
• Agreeing to an item the client has not confirmed.
• Disputing a figure with a bank statement that shows a different year.
• Totals that do not add up in the schedule you send.
• Leaving out the signed response form when the notice included one.

How NoticeBrief does this step

NoticeBrief does the reading and arithmetic of steps 1, 2, 4 and 5 and drafts a letter for step 6, for a CP2000, a CP504 or a state notice of proposed assessment. You upload the notice and the filed return (a PDF with a text layer, a Word file or a text file; up to 6 files and 80 pages in total). Claude reads the pages and quotes each figure with its file and page. Code checks that every quote is on its page, then compares each notice figure with the return to the cent, so a one-cent difference shows as a difference.

Step 3 stays yours. The draft takes a fixed position from each status that code computed: an item on no line of the return is drafted as agreed, a matched item as not agreed with its return line and page, and a differing item shows both amounts and the difference. An item whose return line could not be confirmed on its page is marked not checked, with no position drafted. Items like these are listed for you to check. You get a packet with the letter, Exhibit A and that list, plus the letter as a Word file and the schedule as a CSV.

The letter quotes only authority the notice itself prints. NoticeBrief does not read scanned paper pages, and it sends and files nothing. You add the date, the taxpayer's identification and your signature, and you read every position. One notice answered is 29 credits. Sign up to try it.

Questions

Can I agree with part of a CP2000 and dispute the rest?

Yes. The notice lists separate items, and the response can take a different position on each. Say which items you agree with and which you do not, and attach the evidence for each item you dispute.

What if the income was reported, but on a different line?

Cite the form, line and page of the filed return where the amount appears, and show in the schedule that the figures match. The response then shows that the income was reported, only in another place than the notice expected.

Should the response quote the tax code?

Quoting the authority the notice itself prints is safe. Adding citations the notice does not print is a professional judgment for the signer, and each one should be checked against its source first.